Research On Financial Risk Management Of Auto Finance Companies

The automotive finance industry plays a crucial role in the national economy by providing car financing services to consumers,driving the development of car sales and related industries.In addition,the industry provides financial support to automotive manufacturers,promoting the development of the automotive industry chain.In recent years,with the rise of global economic uncertainty and trade protectionism,the domestic automotive finance industry has faced new challenges in financial risk management due to increasingly fierce market competition.Currently,there is still a gap in financial risk management between domestic and foreign automotive finance companies.Foreign automotive finance companies have more mature risk management experience and technology,while domestic automotive finance companies need to strengthen their own development in talent cultivation,technology research and development,and risk management systems.T Automotive Finance Company is the first professional automotive finance company in China and has a representative status in the industry.This article takes T Automotive Finance Company as the research object,and based on relevant financial risk management theory,explores the problems it faces in financial risk management.Effective management of T Automotive Finance Company’s financial risks is carried out from three aspects: risk identification,risk assessment,and risk control.The compromise-based sorting method is used to analyze the financial risks of T Automotive Finance Company,and a comprehensive evaluation index model is established.The model uses the financial indicators disclosed by nine Chinese automotive finance companies from 2019 to 2021 as sample data,and vertically compares nine indicators from five categories: capital risk,asset quality risk,liquidity risk,operational risk,and profitability risk.It evaluates and analyzes the financial risks of T Automotive Finance Company.Finally,relevant measures and suggestions are proposed for the prevention and control of financial risks for T Automotive Finance Company,mainly including improving capital risk management level,strengthening asset quality risk control,enhancing liquidity risk control,improving operational management capabilities,and improving overall profitability.The aim is to provide guidance for T Automotive Finance Company while providing reference and inspiration for financial risk management in other automotive finance companies.